Overview of the Cosmetic Industry
In the retail sector, the cosmetic industry continues to be an urban-driven phenomenon. The proliferation of the cosmetic industry is dependent on the level of urbanization in a region, and consumption patterns hinge on end-users’ disposable incomes. With changes in lifestyle, people in emerging countries have started spending considerable sums on health and wellness. They also devote more attention to maintaining personal hygiene and grooming. This tendency offers several opportunities for leading players in the cosmetic industry to leverage and expand their presence in the market. The shift in consumer preferences reflects a broader acceptance of currently under-represented product lines. Furthermore, the consumer’s demand for products with natural ingredients will trigger the need for organic goods in the global cosmetic industry.
The Business Challenge and Journey
The client, a leading player in the cosmetic industry, was looking at leveraging solutions for supply market intelligence. The client was facing issues related to increased uncertainty in the economic markets. Therefore, the client wanted to monitor market conditions closely and respond appropriately through improved supply chain strategies. Also, since the instability of their supply chain had increased their risks while conducting business operations, concerns were being raised on the continuity of service delivery operations.
Moreover, the company’s supply chain management executives recognized the tremendous scope of implementing a supply market intelligence study to minimize the impact of supply chain risks on profitability. As such, they were looking at reducing the company’s risk profile by implementing strategies to maximize their financial gains.
To identify challenges in the supply chain activities, the strategic sourcing analysis experts at SpendEdge carried out extensive research comprising interviews and discussions with prominent stakeholders in the cosmetic industry. The experts also compiled information across a wide array of reliable sources such as trade shows, company presentations, industry forums.
Why should you leverage supply market intelligence?
Supply market intelligence helps organizations in developing a competitive advantage by reducing risks through increased knowledge of the supply market dynamics and supply base composition. It acts an essential component in minimizing supply chain risks to maximize ROI.
In fact, best-in-class companies have a dedicated supply market intelligence team that is committed to research and reporting of market indices, cost economics, price inflations, market trends, and other elements that feed into budget planning and marketing initiatives across the enterprise.
Fundamental questions answered in this strategic supply market intelligence study include:
The last few years have witnessed a stagnation in the sales of cosmetics in several developed markets. This has compelled manufacturers in the cosmetic industry to capitalize on growing consumer interests in the health and wellness segment. This also enabled them to improve sales by investing in new products, which contain natural ingredients.
SpendEdge’s supply market intelligence solution offered relevant insights that helped the client to develop effective strategies to streamline their procurement processes. It also helped them track commodity markets and suppliers. Our supply market intelligence solution assisted the client in consolidating their purchasing power to secure the best value available in the marketplace. Moreover, the supply market intelligence solution offered detailed insights that helped the cosmetic industry client to work closely with customers to react quickly to market disruptions and opportunities.
Factors promoting the growth of global cosmetic industry include:
- A multichannel distribution system: Cosmetic products are now available in several locations, online stores, department stores, boutiques, and discount retailers. Therefore, how and where the customers get their cosmetics will reflect your company’s brand and culture. Also, by adopting a multichannel distribution system, you can improve the visibility of your cosmetic brand.
- Keep track of the industry trends: Monitoring and keeping track of the current industry trends can help you carve a niche for your business. This enables you to identify channels to promote your existing products and to develop new ones to fit the market’s needs.
- Attract the target market: The ability to track your target market define the success of your business. Organizations looking to gain a competitive advantage in the cosmetic industry must devise specific strategies and tactics to gain entry into the market, maintain their position, and gain significant market shares.
The global cosmetic industry has come a long way, and today the cosmetics industry rakes in over 50 billion dollars each year. Leading firms offer more scientifically advanced products due to developments in technology, ingredients, and formulas. Therefore, it becomes essential to understand the industry trends of today and the outlook for future trends. Supply market intelligence acts as a backbone to understanding market trends, and trace materials and products through the supply chain.
To know more about our supply market intelligence solution